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NewsShares of Singapore's CapitaMalls surge 22 pct after offer from CapitaLand
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Shares of Singapore's CapitaMalls surge 22 pct after offer from CapitaLand
by Cals Tue 15 Apr 2014, 11:47
| Shares of Singapore's CapitaMalls surge 22 pct after offer from CapitaLand |
| Business & Markets 2014 |
| Written by Reuters |
| Tuesday, 15 April 2014 10:55 |
SINGAPORE (Apr 15): Shares of CapitaMalls Asia surged as much as 22 percent after Southeast Asia's biggest property developer CapitaLand Ltd offered to buy out minority shareholders in the Singapore-listed shopping mall operator.
CapitaMalls shares hit as high as S$2.21, the highest in about 14 months. Nearly 99 million shares were traded, almost 10 times its average full-day volume over the past 30 days. CapitaLand shares jumped 5.1 percent.
CapitaLand said on Monday it had offered S$2.22 per share for CapitaMalls, in which it already owns 65 percent. The S$3.06 billion ($2.45 billion) deal is aimed at simplifying CapitaLand's corporate structure and taking advantage of a discount valuation at CapitaMalls.
"We see this delisting as a rational move representing low hanging fruit for earnings and ROE (return on equity) growth," OCBC Investment Research said in a report.
The deal allows CapitaLand management to deploy significant capital to assets in CapitaMalls and contribute to earnings, OCBC said, raising its target price on CapitaLand to S$3.79 from S$3.50 and maintaining its "buy" rating.
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